A $22 Million Ticket To Fly

Photo: Flickr/Kimmo de Gooijer

For Andrew Dreskin, the father of online ticketing, one ticket-selling company isn’t enough. First there was TicketWeb, an early online ticketing company, which Dreskin ultimately sold to the company that everyone uses – but loves to hate – Ticketmaster. Now there is Ticketfly, which sells tickets through Facebook and Twitter.

Today, Ticketfly announced $22 million in venture capital funding from a group of investors including SAP Ventures, Northgate Capital, Cross Creek Capital, and Mohr Davidow Ventures. The latest round brings Ticketfly’s total funding over its four years of operation to $37 million.

That’s a lot of cash, but Dreskin plans to use it to do online ticketing the way he’s always dreamed, and in the process take down his old employer Ticketmaster.

In 1996, Dreskin launched TicketWeb, what he claims was the first company to sell tickets to events on the Internet. The service took off, and four years into its run Ticketmaster came knocking and acquired the startup for around $35 million.

The bulk of TicketWeb’s team, including COO Dan Teree, stuck around at Ticketmaster for seven years, but Dreskin walked away not long after the sale. Frustrated by being shoved into a small venue backwater by Ticketmaster leadership, Teree eventually left the ticketing giant to join Dreskin in a creating a new venture.

“Ticketmaster asked us to focus on events with capacities of 1,000 seats or less,” says Dreskin. “They just weren’t overly interested in investing in the TicketWeb platform and didn’t have the desire to see us innovate.”

After watching Ticketmaster hold TicketWeb back from exploiting new technology, Dreskin and Teree saw the perfect opportunity to build a ticketing service on top of social networks. Their service would make it simple for concert promoters to promote their events through social media. Ticketfly launched in 2008.

In the beginning, Ticketfly was designed to make it easy to get the word out about an event on Facebook and MySpace. As the service has grown, it’s added more services to go head-to-head with Ticketmaster and cater mostly to “professional and industrial promoters.” Unlike Eventbrite, which helps individual artists and your local fire-eating act to promote smaller events, TicketFly focuses its energy on big venues. Dreskin doesn’t see Eventbrite as a threat, saying it caters mostly to “wine tasting and bake sales.”

That may be Dreskin’s view, but Eventbrite doesn’t see it that way. Eventbrite is quickly moving upstream to larger events and has ticketed massive shows for The Black Eyed Peas in Central Park, as well as partnering with dance music promotor Disco Donnie Presents to ticket his shows. Suffice it to say, Eventbrite plans to be direct competition whether Dreskin wants it or not.

Still, Dreskin and his team believe that their relationships and history in the music industry, as well as their technology, give them the edge. Ticketfly makes it straightforward for event organizers to build custom websites to show off a band and their music, and sell tickets to their concerts. Promoters can also sell tickets directly in Facebook and schedule tweets about an event on Twitter. During a concert, Ticketfly provides web-based box office software to take payments and manage event entry.

Its offerings have paid off for promoters in a big way. Dreskin says that thanks to Ticketfly’s ability to sell tickets quickly with lower fees and faster marketing efforts, promoters typically show double-digit sales growth when switching from another ticketing service.

Earlier in July, the company challenged Ticketmaster’s business directly when it began offering ticketing for reserved-seating venues. Before July 2012, Ticketfly catered only to general-admission shows, while Ticketmaster ruled the large seating chart-based concert pavilions and stadiums. Now Dreskin is going after the same gigs as Ticketmaster, but looking for a different outcome than his first time around.

After he watched TicketWeb get swallowed and then neglected, Dreskin says he isn’t in a rush to sell Ticketfly. At least not to Ticketmaster.